Investors should buy into financials as the Federal Reserve embarks on interest rate cuts, according to Wolfe Research chief investment strategist Chris Senyek. More upward pressure on longer-term yields will benefit financial stocks, per Senyek. “We’re telling investors you want to be overweight financials,” Senyek said on CNBC’s “Squawk on the Street” on Monday. The sector is a “stealth bull market underneath the surface,” he added. The sector is now up 18.1% for the year, putting it slightly ahead of the S & P 500 ‘s 17.8% rise. The Financial Select SPDR hit a new all-time high Monday, having roared back from the August sell-off. The S & P 500 has not quite made it all the way back to its earlier record. Senyek highlighted Goldman Sachs as standout name in financials. The stock, which is up more than 30% in 2024, has outperformed much of the “Magnificent Seven,” he noted. With the exception of Nvidia and Meta Platforms , Goldman Sachs has notched more gains than the seven-stock group. GS .SPX YTD mountain Goldman Sachs versus the S & P 500 in 2024 “We’d be buying financials, right here and right now, [going] into a steeper yield curve,” said Senyek. A steeper yield curve means long-term rates exceed short-term rates, a friendlier environment for banks’ lending margins. A steepening would reverse an inverted curve that has been the case for the past two years. Other notable big bank stocks that have beat the broader market this year include JPMorgan Chase and Citigroup , which are up 28.5% and 20.3%, respectively. KRE YTD mountain Regional Bank ETF in 2024 Regional banks have also recently climbed higher in anticipation of a lower-rate environment. Although the SPDR S & P Regional Banking ETF is positive by just 9.7% in 2024, it has rallied more than 17% quarter to date.